Takeover talks between Coca-Cola Amatil (CCA) and Palm Springs have broken down, according to press reports. The development follows the securing of fresh capital by the bottled water company.

The Australian Financial Review said that talks were believed to have reached the point of setting the parameters of a due diligence process before directors at Palm Springs baulked at the final price being hinted at by CCA.

Palm Springs said yesterday that it had placed 16.66 m shares at A$0.12 each with fund manager Armytage Private, securing A$2 m (US$1.39 m) in fresh capital.

Armytage Private now holds an 11% stake in the water company.